How to Obtain a Merchant Account Even with Bad Credit

Oct 22, 2013

Credit isn’t the only thing that merchant account servicers look at. They need to know if your business falls into their high-risk pool and possibly what you will be selling. Be prepared for a lot of questions.

To obtain a high-risk bad credit merchant account, all you need to do is, fill out their paperwork for an application for an account. It will take twenty-four to forty-eight hours before they return with their answer. More than likely it will be in the positive and you will be underway to accepting credit and debit card payments.

Be ready

With a new account, you will need to be prepared for a small reduction in each transaction. The reason for that; is an insurance type policy for the merchant account servicer. Don’t be dismayed. A small amount will be taken from each transaction and put into a reserve account, or Escrow if you may. It will sit there to cover any chargebacks you may have.

For those chargebacks

A chargeback is just another word for a refund. They want to cover their backs with any chargebacks that you may have. If you don’t get a chargeback taken care of, the merchant account servicer is held responsible for your lack of responsiveness.

Always take care of chargebacks

Your chargebacks will be the downfall of your merchant account. Be on top of things and take care of your customers before they ever go to the credit/debit card issuing bank. Once it has gone that far, you had better respond to the letter that notifies you of the issue. None responsive account holders will end up in merchant account jail. Also known as the TMF file (Terminated Merchant File). Being put in a TMF file is the death of your merchant account and it will prevent you from ever getting another one.

Take the time

Take the time to shop around for the merchant account servicer that will work best for your business. Don’t be dismayed if you are put into a high-risk pool of accounts. A lot of our day-to-day businesses are in that pool. It’s only because of the risk of high refunds, or rather, chargebacks.

It’s up to you to maintain your merchant account and take good care of it. Once your trial period is over, that reserve account will be released to you, and all the funds that you had taken will be put into your designated account in full. A trial period can last from three to six months. With bad credit, they may make the decision to do it a little longer. Don’t be shy about being active with the results of your account. It is completely up to you whether you are successful, or have a tragic end with your merchant account. Don’t take it lightly, because processing your credit and debit cards becomes impossible without the merchant account. Good luck with your decisions.


Let us help you get a high risk merchant account today!

Get Started

Award winning.

  • 2012
  • 2013
  • 2014
  • 2015
  • 2016

Having a merchant account allows an account holder to take advantage of merchant cash advances. When a merchant is approved for an advance, the business agrees to receive a lump sum of cash in exchange for an agreed-upon percentage of future credit card sales.

Pricing varies depending on the merchant’s industry, past credit card processing history, the type of business seeking the account, average ticket sales, and average transaction volumes.

Yes, EMB works with merchants who are building their credit, as well as those who have poor credit. EMB also approves merchants that have no credit card processing history and businesses that have lost their merchant accounts due to high chargebacks.

Several factors influence a merchant’s risk level. Though only one factor likely will not get a merchant classified as high risk, a combination of these may: business size, location, and industry, credit score, credit card processing history, a industry’s reputation for excessive chargebacks, a prior history of high chargeback ratios, and whether a merchant exclusively sells online.

Virtual terminals are stationed on a merchant’s website, making it easy for customers to make a payment or purchase online. Merchants or a payment processor can easily set up virtual terminals, so online businesses can accept credit and debit card and e-check transactions.

A merchant account is a business account with an acquiring bank. Without this business account, which actually works more like a line of credit, a merchant cannot accept and process credit and debit card transactions. Businesses need a merchant account to accept major credit cards via a static point-of-sale terminal, mobile card reader, or through a virtual payment gateway.

After filling out EMB’s simple online application and submitting any necessary, requested documents, many merchants get approved within 24 and 48 hours.

EMB specializes in working with high-risk merchants. EMB works with many merchants, including but not limited to businesses in these industries: gambling and gaming, adult entertainment, nutraceuticals, vaping and e-cigarettes, electronics, tech support, travel, high-end furniture, weight loss programs, calling cards, e-books and software, and telecommunications.

Live Chat